Toronto Could See More Americans After Trump Win

What the U.S. election means for the Canadian housing market

In the run-up to the election, many Americans including Barbra Streisand, “Girls” star Lena Dunham and R&B singer NeYo pledged to emigrate to Canada if Donald Trump was elected and the thought to leave the U.S. didn’t seem to be limited to them.

Wayne Ryan, managing broker of RE/MAX Crest Realty Westside in Vancouver, told Mansion Global Wednesday that he has already received calls from a handful of disgruntled Americans and that the same thing happened after the re-election of George W. Bush in 2004, which resulted in actual sales.

“We’re likely to see more this time,” he said, and he may be right, as Canada’s immigration website crashed repeatedly as election results unfolded overnight, while Google searches for “moving to Canada” climbed.

This is despite some American immigrants still having to pay U.S. taxes and the immigration process potentially being lengthy, with some predicting it could take as long as half of Mr. Trump’s first term to get the green light to move there.

If they persevere, it’s likely many would settle in Toronto and Vancouver, but how would this impact property prices in the two cities (which had been expected to cool after a period of fervent activity) in opposite sides of the country?

According to Gurinder Sandhu, managing partner at RE/MAX Hallmark in Toronto, an influx of American immigrants could mean further demand in a city where the housing market is already red hot, pushing up sales and prices even more.

Recent figures from RE/MAX showed that sales of C$1 million-plus (US$749,916) surged by 70% in the first nine months of the year, compared with 10,578 in the same period a year earlier. In the C$3 million-plus (US$2.25 million) price bracket, sales skyrocketed by 86%.

This was largely due to overall price appreciation in the market, driven by low inventory and high demand for single-family homes, which has resulted in more homes meeting the higher dollar threshold.

“We’ve had high demand in Toronto so we thought that the demand had come to fruition so would start to level off and result in more modest price increases,” he said.

“However, the election result caught us all by surprise and now there is the potential for more demand than we anticipated. This could push up price growth from mid-single digits to high single digits.”

In addition, Toronto will probably garner more interest from Americans than Vancouver as the latter city’s provincial government introduced a 15% tax on foreign buyers in August to calm an overheating market, Mr. Ryan said. Vancouver’s home prices are also on average more expensive than in Toronto.

“The tax has a gone a way to slow down some of Vancouver’s traffic,” Mr. Ryan said. He added that Americans would also be subject to that, which would offset any currency gains from a weak Canadian dollar.

“We’ll get some of them, but I think it will be really unhappy ones because there are so many hoops to go though in terms of immigration and then they are buying into an expensive market,” Mr. Ryan said.

In contrast to Mr. Ryan, Vancouver-based Brad J. Henderson, president of Sotheby’s International Realty Canada, told Mansion Global that he was yet to receive any inquiries today from Americans looking to move after the election and stressed that it was far too early too tell if there will be any.

“A lot of Americans have been saying in jest that they would move to Canada if Donald Trump won the election, but no-one was very serious. What has happened in the last 24 hours is that what was considered to be a possibility has turned out to be a reality,” he said.

“It’s been very emotional for some people and a lot of their immediate reactions is down to emotion and it’s too soon to tell if there will be an influx.”